LAS VEGAS (Oct. 30, 2001)—Goodyear is looking to boost sales through its smaller dealer customers with a new distribution program called G3 Xpress. The company also plans to double the replacement market share of the Dunlop brand over the next three years.
Company executives announced the plan during the 2001 Goodyear Dealer Conference Oct. 29 at the Aladdin Hotel and Casino in Las Vegas.
Jim Vogel, vice president of sales and channel management, North American Tire, said the new distribution program is open to Goodyear authorized dealers ordering less than $300,000 worth of tires from the company. It aims to take advantage of the ability of wholesale distributors that can provide faster and more complete fill rates than the company can to these smaller accounts, Mr. Vogel said.
Under the program, G3 Xpress dealers have the option of ordering tires direct from the tire maker or from approved wholesale tire distributors. But by ordering tires from approved wholesalers, G3 Xpress dealers can expect faster and more frequent deliveries, higher fill rates and a more competitive and simplified pricing structure, Mr. Vogel said.
He noted that many of the company's smaller dealers have been buying up to 20 percent of their Goodyear products from outside, non-authorized distributors as a result of the company's inability to fill all orders 100 percent of the time. What's more, these dealers have lost out on counting these orders toward volume purchases, driving up their buying price.
Now, with these dealers ordering their tires direct from approved G3 Xpress distributors, these purchases will be counted as part of their purchasing volumes as well as that of the distributor.
“We're formalizing what's already happening out there in the hopes that we'll get more shelf space (in their dealerships),” Mr. Vogel said. “Many wholesale tire centers can provide better service than our freight policy.”
Dealers joining G3 Xpress will see no changes in terms of keeping their Goodyear signage or use of the company's “Xplor” Intranet service, Mr. Vogel said. They also can continue to participate in Goodyear national account and government account business and any company programs they currently can access.
Goodyear developed the program after soliciting dealer input and conducting a pilot program for several years through Schierl Tire in Stevens Point, Wis.
Initially the G3 Xpress program applies only to the Goodyear brand, with the Dunlop and Kelly brands being added later. G3 Xpress replaces Goodyear's associate dealer program, which the tire maker discontinued Oct. 1.
Goodyear currently is phasing in the G3 Xpress program, which will be officially launched in January.
The tire maker also announced plans to boost sales and distribution of the Dunlop brand, which company executives believe has “huge potential.”
Over the next three years, Goodyear plans to double Dunlop's market share by expanding the number of retail points of distribution that sell the brand, Mr. Vogel said.
The company has targeted 50 major metro markets beginning with Atlanta to broaden the brand through new points of sale. Expansion will take place one market at a time, he said.
The Dunlop brand, which Goodyear acquired in North America and Europe in 1999 through a joint venture with Japan's Sumitomo Rubber Co., had been heavily marketed in the U.S. through wholesalers and lacked a strong retail presence, Mr. Vogel said.
During the past year, Goodyear has expanded Dunlop's brand presence through the company's G3 marketing program but coverage across the U.S. still remains spotty in some markets.
To boost Dunlop sales, Goodyear will leverage the brand's upscale original equipment fitments and its strong ultra-high-performance image, segments that offer high profit margin potential.
It also intends to support the brand with an advertising program that surpasses that for BFGoodrich, Pirelli and other performance lines combined, Mr. Vogel said.